Plains All American Pipeline Bullish Signs

Published on Wednesday, 08 February 2012 05:06 Written by TradersHuddle Wire

New York, February 8th (TradersHuddle.com) - Shares of Plains All American Pipeline, L.P. (NYSE:PAA) ended the trading session higher by $0.2 or 0.25% from its previous close. Plains All American's price action formed what is considered to be a bullish engulfing candle that could very well signal continuation of trend or reversal on ongoing weakness.

Plains All American Pipeline, L.P. (NYSE:PAA) is a publicly traded master limited partnership engaged in the transportation, storage, terminalling and marketing of crude oil, refined products and liquefied petroleum gas and other natural gas-related petroleum products. It is also engaged in the development and operation of natural gas storage facilities. The Company operates in three business segments: Transportation, Facilities, and Supply and Logistics.

Plains All American's recent stock range has been formed by a trough where calculated support was defined at $69.48 and by a peak that established the resistance level at $78.33, which could be used by traders planning their trades.

Traders wanting to establish a position in Plains All American Pipeline or traders that are already holding the stock can use the bullish engulfing pattern to their advantage. The pattern provides a defined risk as it shows where the bears were able to push the stock down, before the bulls stepped in.

The bullish engulfing pattern is a leading indicator that provides an alert to the bulls that the trend will continue or that there is an immediate reversal to the short term weakness seen on the stock. Below an Engulfing Bullish Candle Illustration: